Better understand your store’s profitability and health
- Products in your store may be generating a lot of sales, but not actually making you money because of their margin or how much stock you were left holding. By measuring GMROI you gain accurate number on your inventory profitability.
Make your money work for you
- By comparing the GMROI of your categories, vendors, and manufacturers, you can make sure you are investing in products that bring back a profit. In this way, you can know your inventory is actively generating cash for future purchases.
Negotiate with your vendors
- Use the GMROI by Default Vendor variation to strengthen your negotiations with vendors. Instead of just talking about margin, talk about the full picture with GMROI and drive for better terms.
Be able to invest in other areas of your store beyond inventory
- By stocking what you know to be profitable, and planning your purchasing to get a better return on this investment, you will have more money available to invest in other areas of your store—like marketing, employees, or that break room grill you’ve been eyeing.